Land Remediation Relief
At LJS Accounting Services, we support clients in making a claim for up to 150% tax deduction on their land remediation costs or a payable tax credit of 16%.
What Is Land Remediation Relief?
Land Remediation Relief (LRR) was introduced as part of the Finance Act 2001 to encourage the clean-up and redevelopment of contaminated land, helping businesses involved by providing Corporation Tax relief of 150% of qualifying costs or a payable tax credit of 16% if they’re at a loss.
The scheme was designed to promote redevelopment, protect the environment, and make previously unusable land viable for commercial use. If you think your project may qualify or need help making a claim, our team can guide you through the rules and ensure you receive the full relief available.
Types of Qualiying Contamination
The following categories of contamination and hazards qualify for Land Remediation Relief:
Industrial & Chemical Contamination
Hydrocarbons, heavy metals, hazardous chemicals, solvents, and other harmful pollutants.
Asbestos & Building-Related Contamination
Asbestos in the land or building, buried structures, redundant underground services, and foundations that require removal or treatment.
Naturally Occurring Contamination
Japanese knotweed, radon gas, and arsenic in the soil or underground water.
Derelict Land
Long‑term derelict land that has been derelict since 1 April 1998 (or earlier).
You can only claim relief on contamination or dereliction that existed before you acquired the land and that your business did not cause or have involvement in causing.
Contaminated Land vs Derelict Land
Land Remediation Relief can be claimed for contaminated land or long-term derelict land.
However, both are different, but they can qualify for the same 150% tax relief.
Contaminated Land
- UK company subject to Corporation Tax
- Contamination or dereliction existed before you acquired the land
- Carrying out work to establish the contamination level of contaminated land
- Removing the contamination
- Containing the contamination to reduce harm to the environment
- Aiming to make the land suitable for new use
Derelict Land
- Must have been continuously derelict since 1 April 1998
- You can claim relief to bring the land back into productive use
- Costs are focused on removing man-made obstacles that prevent development
- Land must be in a non-productive state and cannot be used without the removal of old and dangerous structures
Do You Qualify?
To claim Land Remediation Relief at LJS Accounting Services, your business must meet the following criteria:
- UK company subject to Corporation Tax
- Contamination or dereliction existed before you acquired the land
- Carrying out work to establish the contamination level of contaminated land
- Removing the contamination
- Containing the contamination to reduce harm to the environment
- Aiming to make the land suitable for new use
If you meet our criteria, our land remediation tax specialist can assist you in making a claim to HMRC.
Contact a Land Remediation Tax Specialist
At LJS Accounting Services, we assist clients in making a Land Remediation Relief claim. You must aim to make your claim within one year of filing your company tax return. However, it may be possible to make a claim, amendment, or withdrawal after your filing date if HMRC allows you to do so.
We encourage businesses to take advantage of the relief to invest in the improvement of sites and local communities. It allows for qualifying expenses during the remediation process to be offset against your company’s taxable profits, offering a financial benefit for your business.
To learn how we can help support your Land Remediation Relief claim, please contact us today.
Land Remediation Relief FAQs
You can claim Land Remediation Relief if you're a UK company subject to Corporation Tax. Individuals, trusts, and sole traders are therefore not eligible for the relief.
Qualifying expenditure for Land Remediation Relief covers a range of costs directly linked to cleaning and restoring contaminated land, including the removal of affected soil, water or structures, assessing the level of contamination, and paying wages for the remediation work. It also extends to the installation of new systems and the materials needed to complete the project.
The Land Remediation Relief process involves checking your eligibility against strict HMRC criteria, identifying qualifying contamination, carrying out remediation, claiming the relief, and submitting your tax return with help from our accountant.
You could claim up to a 150% tax deduction on land remediation costs if your company is profitable or a payable tax credit of 16% if your company is not profitable (a loss-making company).
Your land remediation tax specialist will help you identify qualifying expenses, calculate potential tax benefits, secure cash credits if your project is loss-making, manage HMRC compliance, submit your claim to HMRC, and provide trusted advice and guidance on the best steps to take.
Ready to work with us?
Get in touch with one of our consultants today and we will be happy to help you with your matter.
